Red Hat's JBoss plan: Divide and conquer?

In an effort to increase revenue from its JBoss server software, Red Hat is contemplating splitting the product into two versions - a free, unsupported product and a subscription-based supported one.

Currently there is a single version of JBoss and Red Hat has sold support for it since acquiring the company behind it in April. But chief financial officer Charlie Peters, speaking at a UBS financial conference on Tuesday, said the company is considering applying the two-version formula it used to profit from Linux.

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Red Hat, faced with expanded competition from Novell and Oracle, is under pressure to make money off JBoss. Nearly 11 million copies of the server software have been downloaded for free but today JBoss has "a very small paid customer base", Peters said.

He added: "Our opportunity here is to use the knowledge of what we've done on the Linux side to create the same kind of environment on the middleware side, and to convince customers of the value of moving from free to paid."

Open source software, including many versions of the Linux operating system or the JBoss "middleware" for running Java programs on a server, generally can be downloaded at no cost. For that reason it has posed challenges to businesses. Red Hat's strategy for Linux profits has been to offer a free, fast-changing version called Fedora and a supported, more stable version called Red Hat Enterprise Linux (Rhel).

While Rhel's underlying source code is freely available, only those who pay Red Hat annual subscription fees get access to the "binary" software that runs on a computer. The subscribers' version is also the one that comes with multiyear and Red Hat certifications to work with specific hardware and software.

With JBoss, Peters said: "One thing we're trying to address is the development model, to come up with something similar to the Rhel-Fedora model... At the moment, we're still working on that model for JBoss. We are confident we can move more of the free JBoss users over to paid subscribers."

Stephen Shankland writes for CNET News.com